NZ Local Government Needs To Face Reality

“
Local Government New Zealand needs to face reality and
recognise that it must play a constructive role in solving
New Zealand’s housing affordability crisis. It must know
that in 1991, New Zealand’s homeownership rate was one of
the highest in the world at 74% in 1991 and is projected to
slip to 63% by 2011” said Hugh Pavletich, co author of the
2006 Demographia International Housing Affordability Survey
www.demographia.com , released this week.

The
Demographia Survey found that all the major urban centres in
New Zealand are “severely unaffordable” and that there has
been a serious deterioration in affordability over the past
twenty years. Affordable cities should have house pricing at
no more than three times household income. Auckland is
currently at 6.6; Wellington at 5.2 and Christchurch 5.9 as
at September 2005.

Mr Pavletich is of the view that
the Demograhia Survey clearly illustrates that well governed
urban areas internationally, are achieving housing
affordability standards of 3 times household income and that
historically, most urban areas achieved this.

“Instead
of reacting negatively to the Survey, Local Government
should work with the community and explore ways to solve
this issue”

He is of the view that there is an urgent
need for local governments throughout New Zealand, to use
the Demographia Survey as a guide, in identifying the degree
of affordability in each area. From this, the problems can
be clearly identified so that communities themselves can
find solutions, to ensure that within a reasonable time,
their affordability levels do not exceed three times
household income.

“ We know from our exhaustive global
research, summarized within the 2006 Demographia Survey,
that land supply is the root of the problem. Importantly
too, that there are urban areas currently achieving
sustainable affordability levels, as we did historically”
said Mr Pavletich, adding “Mr Morrison of Local Government
New Zealand needs to show more confidence in the capacity of
his fellow New Zealanders and in our ability to work
together, in solving this issue.”

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